Property investor reveals how independent agent appraisal slashed capital gains tax by $60,000

OPINION I never thought it would happen, but last year a real estate agent saved me $60,000, or at least reduced my taxable income by that amount. See, back in 2020, my family moved out of our home and turned it into an investment property, the equity of which we used as a deposit on our next home. Because the property was to be the security on our next loan, the bank gave it a relatively conservative valuation. It made sense, because banks need to protect themselves against risk. I didn’t think too much of it, until it came time to sell that investment property last year. MORE: Aussies brace for all time interest rate shock Selling an investment property means paying capital gains tax (CGT) and even though this was in the time when the CGT discount of 50 per cent still existed, that conservative bank valuation made for a much larger gain. Bank valuations are usually conservative to minimise their own exposure to risk. We sold the property for $520,000 more than the bank valued it at five years earlier, which would mean we were paying tax on a $260,000 gain after the discount was applied. This was painful, because I knew the bank’s valuation was not a true market value at the time....